British Airways is one airline that has gone through both bright and turbulent times since its founding in 1974.[i] After thirteen years of government control, British Airways went into privatization in 1987.[ii] The airline is the surviving entity after merger and consolidations made with British Overseas Airways Corporation (BOAC) and British European Airways Corporation (BEA).
Currently it operates about 240 aircrafts servicing 120 destinations throughout the United Kingdom and Europe, Africa, North and South America, the Middle East, Asia and the Pacific.[iii].
British Airways competes with about 42 other British airlines but has maintained leadership in most areas of the aviation industry not only in the United Kingdom but in Europe as well.[iv] Its main competitor is Virgin Atlantic, an airline established by Richard Branson in 1984 and with about 10 per cent market share in terms of kilometers logged as of 2007.[v]
As airlines around the world struggle to survive in the midst of the worldwide financial crisis, British Airways vows to target growth and raise its market share while intently addressing its operational concerns towards excellence and financial health.
The surging complexity of the market ahead is expected to put the airline industry on the offensive to obviate possible downturns as what happened to the automobile and the investment banking industries during the last quarter of 2008 leading to the global financial turmoil.
Reports had it that requests for government bailouts were made in the face of lower demand from car buyers. The airline industry thus, is among those expected and likely to be affected by the crisis due to the expected economic contraction in the aftermath of the financial meltdown.
Importance of the Study
The study is an attempt at providing a trajectory, focus as well as strategic road map on how British Airways should repackage itself towards upgrading and raising its potentials in a cutthroat aviation industry not merely in the United Kingdom but in the airline’s other service areas around the globe, Europe especially.
For a start, British Airways dutifully crafted the BA Business Plan (BP11) which is aimed at focusing on four key priorities arising out of the previous year’s plans. These are:
(1) Upgraded customer experience with its trademark Basics and Brilliance, Club World, First Cabin and similar programs meant to introduce innovative customer come-ons with its plan to acquire long-haul aircrafts as well as counter the negative impact of the operating glitches during the transitions experience at Heathrow Terminals 1, 4 and 5. Incidentally, this was planned to introduce new forms of premium customer experience through increased presence in the European and American markets;
(2) Planning for growth in terms of new long haul aircrafts, premium services and added destinations between Europe and the Americas;
(3) Continuing need to control costs in the face of tight competition, rising cost of delivering service, fuel and administrative costs. The entity additionally attempts at undertaking a more efficient assets and liability management to reasonably assure itself the advantage of liquidity and solvency under the current economic environment; and,
(4) Taking a lead in corporate social responsibility to articulate a social and corporate balance in the conduct of its operations.[vi]
A critical component of BP11 is the marketing plan (MP11) which identifies and concentrates on the opportunities available to British Airways worldwide in congruence with its identified key priorities.
The marketing plan clearly outlines a road map towards market recovery via excellence in the basics, and ultimately to the deployment of brilliant premium services not available anywhere or in other airlines competing in identical routes.
Specifically, the Marketing Plan MP11 cross links with the Business Plan (BP11) with the former as the centrepiece of the airline’s assertive leadership thrusts towards the first half of the 21st century. Just like the Victoria era slogan that the “sun does not set on the British empire”, British Airways is determined to head for industry prominence after several turbulent encounters with difficult challenges that it had to go through.
Apparently brought about by its own weight, its bigness is without the support mechanism it needed to stabilize its moves. A component of the BP11, the MP11 describes in more detailed fashion how the BP11 will breathe through the heart of the MP11 which is considered the heart of the Business Plan.
On the aspect of significance on research, the MP11 serves as the management blue print for strategic decision-making; especially in the area of marketing management under various assumptions, scenarios, alliances and configurations.
Strategic marketing management which is contained in this road map MP 11 will enable management to adopt strategies such as cost leadership, attractive premium services, human resource strategies and expanded terminal network in the industry as means to create a demand gap in the long haul travel sector as well as a similar gap in the premium business travel from continental Europe to the premier city of New York in the United States. The experiences of the past years are expected to provide hard lessons for British Airways management towards strategic marketing processes.
For the business traveller all over, the MP11 attempts to redefine the concept of basic and premium travel. With the integration of cost advantage expected to ensue along the airline’s objective of operational excellence, airline travellers can reasonably expect these cost rationalization measures to have a positive effect on the pricing competitiveness of British Airways while maintaining the class with which British Airways has been known for.
The airline industry, for one, is likewise expected to significantly benefit from this study specifically in the area of collaboration, alliances and economic cooperation without any attempt at abusing the regulatory privilege this union may provide such alliances.
Hence, partnerships should be undertaken for the development and maintenance of constructive relationship with other companies in the industry as at work.[vii] In the same way that this will be tempered and enhanced by a strong corporate social responsibility not only in terms of the environmental aspect, it is expected similarly to be strong along the social issues directly and indirectly affected by the industry.
The society, in general, and the employees in particular will reap benefits from this study in terms and along the key balanced scorecard perspectives over secure employment tenure, human resource training and performance recognition dimensions incorporated into the business and marketing plans; all considered critical components and means to stabilize the goal of operational excellence with a genuine corporate social responsibility.
Primarily, the shareholders are the targets of this study as among the major beneficiaries through which an innovative and unprecedented pricing incorporates real shareholder value and corporate pride enhanced with financial viability through operational excellence. British Airways aims to show gratitude for continued support and recognition as Britain’s primary carrier.
The academe is similarly expected to acquiesce the benefits from this Plan which comes as a result of intensive research and careful study on the travel and industry markets in which British Airways is among the major players.
Of equal importance is the fact that British Airways is a corporate organization that is considered an excellent source of academic studies in an industry characterized with great risks, complexities as well as opportunities with huge potentials for learning, and even further researches.
[i] Annual Report, 2007, British Airways, http://www.britishairways.com, accessed December 28, 2008
[ii] Ibid. http://www.britishairways.com,
[iii] Ibid, http://www.britishairways.com,
[iv] Ibid., http://www.britishairways.com,
[v] Ibid., http://www.britishairways.com,
[vi] Ibid, http://www.britishairways.com,p. 34
[vii] J. Hicks, The Challenge of the New Millenium: winning the Struggle with Ourselves, New Falcon Publications, Arizona, 1997, p. 131.
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